States Cracking Down on Drug Marketing

By JOE MULLIN, Associated Press Writer

Pharmaceutical-company sales reps who visit doctors' offices to promote their products know a surprising amount about the physicians before they even walk through the door.

Maybe too much, some lawmakers around the country say.

Legislators are taking a hard look at data-mining companies that keep detailed records on exactly what drugs are prescribed by nearly every doctor in the U.S.

These databases, updated weekly, are stripped of patient names and then sold to drug companies, which use the information to identify doctors who might be particularly receptive to their sales pitches.

Consumer advocates and others say sales reps then try to manipulate these doctors into prescribing certain drugs. That drives up health care costs and interferes with the practice of medicine, they say.

"We're not talking about trying to get you to come into a store to buy a product," said Nevada state Sen. Joseph Heck, an osteopath who wants to crack down on the practice. "We're talking about you trying to influence me in prescribing a certain drug for my patient. That, to me, is unethical."

Data-mining companies strongly defend what they do, saying the information they provide makes marketing less wasteful, more profitable and less annoying to doctors.

New Hampshire last year became the first state to ban such use of the data.

"I would say most doctors are shocked when they hear that drug reps really know everything they've written," said New Hampshire state Rep. Cindy Rosenwald, who sponsored the legislation.

The nation's largest health data-mining company, IMS Health of Norwalk, Conn., is challenging the New Hampshire law in federal court. IMS is also fighting a 2001 ban in the Canadian province of Alberta on releasing doctors' names.

States that have considered similar bills include Arizona, Illinois, Kansas, Maine, Nevada, New York, Massachusetts, Rhode Island, Vermont, Washington, West Virginia and Texas. A federal bill was proposed last year but died in committee.

IMS buys information on doctors' prescribing habits mostly from big pharmacy chains. The company then cross-references the data with information bought from the American Medical Association on doctors, their areas of specialty, and where they went to medical school.

IMS looks at each doctor's age and gender and how their patients pay. After mixing in survey data on doctors' attitudes, beliefs and values, the company divides the physicians into certain groups, such as "innovators," "early adopters" and "late adopters."

One IMS brochure boasts that a pharmaceutical company used fewer sales reps and saved $50 million after IMS helped it "establish deeper relationships with the `right' physicians."

In the New Hampshire court challenge, former Eli Lilly and Co. sales rep Shahram Ahari said that he used the information to push certain doctors to prescribe more Prozac and Zyprexa, a drug for schizophrenia.

Heck said that amounts to meddling in doctors' decision-making.

IMS lobbyist Randolph Frankel said there is nothing secretive about what his industry does. The company has argued that its activities are protected as commercial speech under the First Amendment and that certain medical privacy laws were intended to protect patients, not doctors.

Drug companies need the prescriber information to make sure physicians have the most up-to-date information about the drugs they use, said Andrea Douglas, a spokeswoman for the Pharmaceutical Researchers and Manufacturers of America, an industry trade group.

For its part, the AMA has lobbied against the state privacy proposals, saying the information on doctors' prescribing habits is also used by researchers and federal agencies.

Also, the AMA started an opt-out program last year that allows doctors to prevent their names from being given to sales reps. Those who are demanding legislation complain that the opt-out program relies on drug companies to police themselves.

IMS Health, the largest of four major players in the data mining industry, has 7,400 employees and operates in more than 100 countries. In a recent government filing, IMS said that substantially all of its $1.96 billion in 2006 revenue came from drug companies, and about half was earned optimizing those companies' sales forces. Of that, IMS made $444 million in profit.

Each month, the company's database processes prescriptions from 1.4 million U.S. doctors and other prescribers.